U.S. stocks closed mixed
NEW YORK, July 25 (UPI) -- U.S. stocks closed mixed Wednesday, as early gains faded late in the day.
Britain said its gross domestic product fell further than expected in the second quarter. The National Statistics Office said the GDP dropped 0.7 percent from the first quarter. Economists had forecast a 0.2 percent decline.
The U.S. Commerce Department said sales of new family homes rose 15.1 percent in June 2012 over June 2011 in a report that supports data released earlier in the week that showed home prices on the rise.
By the close of trading on Wall Street, the Dow Jones industrial average added 58.73 points, 0.47 percent, to 12,676.05 in mid-afternoon trading. The Standard & Poor's 500 index shed 0.42 points, or 0.03 percent, to 1,337.89. Tech-heavy Nasdaq composite index lost 8.75 points, or 0.31 percent, to 2,854.24.
On the New York Stock Exchange, 1,614 stocks advanced and 1,410 declined on a volume of 3.5 billion shares traded.
The benchmark 10-year treasury note fell 4/32 to yield 1.405 percent.
The euro rose to $1.215 from Tuesday's $1.2061. Against the yen, the dollar fell to 78.14 yen from 78.19 yen.
In Tokyo, the Nikkei 225 index lost 1.44 percent, 122.19, to 8,365.90.
In London, the FTSE 100 index was flat, dropping 0.02 percent, 0.91 points, to 5,498.32.
World Trade Center projects becalmed
NEW YORK, July 25 (UPI) -- A lack of tenants is stalling construction of new office space at Ground Zero in New York, where the World Trade Center towers once dominated the skyline.
The building known as 3 World Trade Center is having such trouble finding tenants that construction has been halted at eight stories, one-tenth of its design, The Wall Street Journal reported Wednesday.
Larry Silverstein of Silverstein Properties Inc. said a deal with the government forbids him to build any higher without a commitment from tenants.
At the same site, 4 World Trade Center is expected to be completed by 2014. Half of that building is leased by government agencies, the newspaper said.
One World Trade Center, a project of the Port Authority of New York and New Jersey is also half leased, much of that going to Conde Nast, the publishing firm.
That building is expected to be finished in 2014.
The construction of 2 World Trade Center, another Silverstein project, is completely on hold, also a victim of the slow economy.
"They're excellent office buildings. There's just not demand," said Mark Weiss, vice chairman at real-estate services firm Newmark Grubb Knight Frank, a firm working to find tenants for the buildings.
Geithner grilled on early Libor reaction
WASHINGTON, July 25 (UPI) -- Lawmakers in Washington Wednesday grilled Treasury Secretary Timothy Geithner on his early reaction to the Libor rate-setting scandal.
The harsh questioning came mostly from Republicans on the House Committee on Financial Services, while several Democrats were more forgiving of Geithner, who learned banks were manipulating the London interbank offered rate, or Libor, as far back as 2008.
British bank Barclays recently settled a case with regulators by agreeing to pay $450 million for attempting to manipulate the rate that is a benchmark rate for trillions of dollars of commercial and personal loans.
One of Geithner's lines of defense was that the Libor, which is set by a banking association in London, was a British problem.
At the time, a period in which he was president of the New York Federal Reserve, he alerted other regulators. The Fed at the time also forwarded a set of changes to the Libor process that would make it harder to manipulate, Geithner said.
"We gave them very specific detailed changes. If more of those would have been adopted sooner, you would have limited the risk," Geithner said.
Geithner's testimony centered on progress of the Financial Stability Oversight Council, specifically the second annual report on the council that was created by the Dodd-Frank financial overhaul bill.
Geithner said financial regulations have improved in the past two years. "We now have the ability to put the largest financial companies under enhanced supervision and prudential standards, whether they are banks or non-banks," Geithner said.
He said nine of the country's largest banks had submitted "living wills," that would serve as guides for orderly transitions, should any of them fail.
Republican lawmakers, however, centered questions on why Geithner did not pursue legal confrontations with banks over Libor manipulations, instead of addressing the issue with broader regulatory brushstrokes.
They wanted to know why Geithner did not charge any banks with a crime in 2008.
"What was being disclosed here was fraud," said Rep. Randy Neugebauer, R-Texas.
"We took the initiative to bring those concerns to the broader regulatory community. I believe we did the necessary and appropriate thing very early in the process," Geithner said.
Weill calls for big bank breakups
NEW YORK, July 25 (UPI) -- Former Citigroup Chairman and Chief Executive Officer Sanford Weill said Wednesday it is time once again to break up the big banks.
"What we should probably do is go and split up investment banking from banking, have banks be deposit takers, have banks make commercial loans and real estate loans, have banks do something that's not going to risk the taxpayer dollars, that's not too big to fail," Weill said in an interview.
"If they want to hedge what they're doing with their investments, let them in a way that's going to be mark-to-market, so they're never going to be hit," he said.
CNBC reported Wednesday Weill, for all intents and purposes, was advocating for the Glass-Steagall Act to be reinstated.
Important provisions of the Glass-Steagall Act were repealed in 1999. In place since the bill was written in 1933, the provisions separated securities activities and commercial banking.
It was seen in 1999 as ineffective, because commercial banks and their affiliates were overlapping. But analysts have said it was also a firewall that would have prevented the 2008 financial crisis by preventing some firms from becoming too big to fail.
Weill said he was "suggesting that they (banks) be broken up so that the taxpayer will never be at risk, the depositors won't be at risk, the leverage of the banks will be something reasonable, and the investment banks can do trading."
"They can make some mistakes, but they'll have everything that clears with each other every single night so they can be mark-to-market," Weill said, using an accounting term that means the value of an asset is reconciled with the market value.
